Question

OBJ. 1, 2, 3, 4 PR 2-2A Journal entries and trial balance On January 1, 2019, Sharon Matthews established Tri-City Realty, which completed the following transactions during the month: a. Sharon Matthews transferred cash from a personal bank account to an account used for the business, $40,000. b. Paid rent on office and equipment for the month, $6,000. c. Purchased supplies on account, $3,200. d. Paid creditor on account, $1,750. e. Earned fees, receiving cash, $18,250. f. Paid automobile expenses (including rental charge) for month, $1,880, and miscel- laneous expenses, $420. g. Paid office salaries, $5,000. h. Determined that the cost of supplies used was $1,400. i. Withdrew cash for personal use, $2,000. Instructions 1. Journalize entries for transactions (a) through (i), using the following account titles: Cash; Supplies; Accounts Payable; Sharon Matthews, Capital; Sharon Matthews, Draw- ing; Fees Earned; Rent Expense; Office Salaries Expense; Automobile Expense; Supplies Expense; Miscellaneous Expense. Explanations may be omitted. 2. Prepare T accounts, using the account titles in (1). Post the journal entries to these accounts, placing the appropriate letter to the left of each amount to identify the transactions. Determine the account balances after all posting is complete. Accounts containing only a single entry do not need a balance. 5. Prepare an unadjusted trial balance as of January 31, 2019. 1. Determine the following: a. Amount of total revenue recorded in the ledger. b. Amount of total expenses recorded in the ledger. c. Amount of net income for January. - Determine the increase or decrease in owner's equity for January

Answer 1

1) Journal entries without explanation as required:
Date	Acc Titles	Debit $	Credit $
a	Cash	40000
	Sharon Matthews,Capital		40000
b	Rent expense	6000
	Cash		6000
c	Supplies	3200
	Accounts Payable		3200
d	Accounts Payable	1750
	Cash		1750
e	Cash	18250
	Fees earned		18250
f	Automobile expense	1880
	Miscellaneous expense	420
	Cash		2300
g	Office Salaries expense	5000
	Cash		5000
h	Supplies expense	1400
	Supplies		1400
i	Sharon Matthews, Drawing	2000
	Cash		2000

2) T-Accounts:
DEBIT	Amount $	CREDIT	Amount $
Cash a/c
a	40000	b	6000
e	18250	d	1750
		f	2300
		g	5000
		i	2000
		CB	41200
Sharon Matthews,Capital A/c
		a	40000
Rent expense a/c
b	6000
Supplies a/c
c	3200	h	1400
		CB	1800
Accounts Payable a/c
d	1750	c	3200
CB	1450
Fees earned a/c
		e	18250
Automobile expense a/c
f	1880
Miscellaneous expense a/c
f	420
Office Salaries expense a/c
g	5000
Supplies expense a/c
h	1400
Sharon Matthews, Drawing a/c
i	2000

3) Unadjusted Trial Balance:
Acc Titles	Debit $	Credit $
Cash	41200
Sharon Matthews,Capital		40000
Rent exp.	6000
Supplies	1800
Acc Payable		1450
Fees earned		18250
Automobile exp.	1880
Misc. exp.	420
Off Salaries exp.	5000
Supplies exp.	1400
Sharon Matthews, Drawing	2000
Total	59700	59700
4)
a) Total revenue = $18250
b)Total expenses = 6000+1880+420+5000+1400=14700
c) Net Income = 18250 - 14700 = 3550
d) Owner's equity = 40000+3550-2000 = 41550